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What Does It Mean to be a “Subscription MMO?” July 18, 2014

Posted by Wilhelm Arcturus in entertainment, EVE Online, EverQuest II, Lord of the Rings Online, Rift, Sony Online Entertainment, Star Wars: The Old Republic, The Elder Scrolls Online, World of Warcraft.
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I am on the press release list along with a lot of real media outlets, so my inbox is often stuffed with the raw material that is barely recycled for content a lot of places around the web.

I skim through them every day, but don’t bother to mention 99% of them as they tend to be rather thin on things worth talking about.

This morning through there was a press release from SuperData Research pointing at their June factoid report.  Lots of little bits of data in that from which you can barely come up with to points to draw a line about anything.

The highlight of the report though was a chart listing out revenues for the top subscription-based MMO titles for 2013, worldwide.

Top Subscription MMO Revenue

Top Subscription MMO Revenue

The top spot is unsurprising.  WoW, even down to something like 60% of its peak, still rakes in money like no other.  Then there are a couple Asian MMOs which you might have heard of if you have been paying close enough attention.  Lineage 1 is still NCsoft’s biggest money maker.

And then you come to Star Wars: The Old Republic and Lord of the Rings Online, where you might legitimately ask a question like, “Hey, aren’t those free to play?”

As the title of this post asks, what makes for a subscription MMO these days?  Because if we are talking about needing a subscription to play, several of those titles fall off the list immediately.

But if, as the list here suggests, merely offering a subscription option is enough to be called a subscription MMO, then aren’t we missing a title or two.

Specifically, I would expect EverQuest II to make the list.  I don’t have any hard data to back up that expectation, but my gut impression of the game is that it ought to be somewhere on the list ahead of Lord of the Rings Online, something that is backed up, in my mind, by the fact that EQII has no problems cranking out expansions and interim content for all ranges of player while LOTRO is publicly giving up on raiders for now and doesn’t seem to be able to scrape it together for an expansion in 2014.

But maybe EQII isn’t doing as well as I thought.  Or maybe SOE’s model somehow falls outside of what SuperData considered a subscription MMO.  Or, most likely, maybe SOE just didn’t cooperate with SuperData and its information requests.  And one could also ask about Final Fantasy XIV.

Otherwise, I am somewhat surprised at where LOTRO ranks.  SWTOR is still popular, if not WoW popular, and that its revenue is only 1.65x what Turbine gets for LOTRO seems odd, given the downtrodden way Turbine seems these days.  And Rift seems way down the line.  But that does seem to mostly line up with the 2013 end of year summary for the Digital Dozen over at The Nosy Gamer.  EVE is generally higher on the list than LOTRO, but otherwise it seems about right.  Does that give this chart more validity?  Or the Digital Dozen?

And, of course, one key item missing from this chart is how much subscription revenue played into the totals listed.

Because the follow up chart points out that subscription revenues have been decreasing since their peak in 2010.

Subscription revenue

Subscription revenue

Subscriptions are trending down, while microtransactions are… well…  sort of flat really if you look at that line.  They are not not rising up sufficiently to off-set the loss of subscription revenue overall, which seems to go against what some cheerleaders for the model would have us believe.

Which might be why we saw a couple of subscription based launches this year.  SuperData pulled out the very exact number of 772,374 for The Elder Scrolls Online subscriptions.  That would make for a nice revenue stream.  WildStar was mentioned, but since it just launched in June, there were no numbers.

I would really like to know how much of the revenue for a game like SWTOR or LOTRO comes from subscribers.  If that chart is to be believed, subscriptions still make up most of the revenue.

And what does all of this mean?  This isn’t the range of data I would like, but you look at the industry with the data you have, not the data you want.  But I am not prepared to go all Massively comment thread, where the trend seems to be “lying liars lie!” for everybody whose pet theory is not supported by the data provided.

Anyway, as noted, the full report is here.  If you want more data, you have to pay.

Addendum: Azuriel makes an interesting comparison between the above chart and other MMO data available.

Addendum 2: And Flosch takes the numbers and extrapolates a bit.

Comments»

1. Pasduil - July 18, 2014

Fascinating stuff, though you have to wonder how they get their numbers. The MMO companies don’t seem keen on allowing anyone to have reliable info on such things.

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2. tsuhelm - July 18, 2014

Oh this is great :) Friday late from leaving work and this lands on my virtual ‘lap’….

So revenues from MMO’s that have some form of subscription, yes it would be amazing to find out the breakdown of income from subscriptions vs microtransactions and even income from subscribers’ microtransactions…as I always think those are the players that are always likely to spend again anyway, they have already paid once, getting them to do it again is easy(ier?).

Too much thinking for this frazzled worker…heading off home for the weekend!

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3. bhagpuss - July 18, 2014

I saw this on Massively on my lunchbreak and was curious enough to go to the SuperData site and read the detail there. Not convinced by any of it.

Clearly neither LotTO, SW:ToR, Aion and Rift are all “subscription-based MMOs”. They both made massive PR announcements claiming they had gone F2P sothey don’t even self-identify as “Subscription based”. They are, unarguably, Free To Play MMOS which also offer an optional Subscription.

I’m nowhere near as convinced as you about the number of people playing, let alone subbing to, EQ2. I’ve thought for a long time that Everquest itself probably has more players. I would bet that either of them has more than Rift, though. Rift has 13 servers while EQ2 has 16 and Everquest 17 and as you point out it seems to be worth SOE’s while to pump out annual expansions for both of them while Rift has had one expansion in over three years.

All in all it makes for an interesting talking point but, as usual, the information is too nebulous to use for anything much beyond that. I wonder who actually pays them for this stuff and why.

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4. bhagpuss - July 18, 2014

Grr… Para 2 should begin “Clearly LotRO, SW:ToR and Rift…”.

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5. Ming - July 18, 2014

For the record, I don’t know about Lineage 1, but I’m pretty sure TERA is also free-to-play now. In fact, I would have to go look it up, but it would not surprise me if the only games on that list that require a subscription to play are WoW and EVE (though I suppose you could make a comment about the WoW “Starter Edition”).

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6. Wilhelm Arcturus - July 18, 2014

@Bhagpuss – Yeah… I knew what you meant, but that sentence has issues.

What a company claims to be and what it is need not be the same thing. So the question arises, if your MMO makes most of its revenue via “optional” subscriptions, and those charts seems to make the argument that this is the case, can you call it a subscription MMO or not?

The answer may seem obvious, but if the restrictions on free make it unreasonable to play long term that way, then I think you could argue in favor of the game really being subscription still, with an expansive demo/trial and an obnoxious cash shop.

The fine print on that first chart lays out the very loose “pay to play” definition being used.

@Ming – TERA in the west is F2P, is it that way in Asia?

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7. HarbingerZero - July 18, 2014

Pretty sure TERA’s Russia and Korean server are both F2P as well.

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8. carson63000 - July 18, 2014

I’m absolutely stunned to hear that LOTRO is pulling in more than $100m revenue per annum. That just seems.. so implausible?

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9. Vatec - July 18, 2014

Very surprised to see LOTRO that high on the list, given the utter gutting of the live team that occurred only a few months ago, as well as the fact they’re not bothering to put out an incredibly overpriced expansion this year.

Not surprised at the downfall of Rift, though. The online community has effectively vanished since Elrar “left” the company. Several sites that used to offer almost-daily news on the game have effectively gone silent (Rift Junkies, RiftScene) or gone dark (valvalval). Shame, because it is a very polished game: smooth launch, very generous F2P model. Unfortunately, Trion seemed to lose its way with Ember Isle and the Storm Legion expansion (as well as End of Nations and Defiance) and Rift never really seemed to recover from the mortal blow dealt by the launch of SWTOR.

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10. Vatec - July 18, 2014

@various – It’s pretty clear that SuperData’s definition of a “subscription MMO” is “an MMO that offers a subscription option.” Many “pure” F2P games don’t.

Also, the SWTOR team, at least, has made it pretty clear that their F2P model is intended more as a long-term free trial, with the hope that most players will subscribe rather than put up with the restrictions. Same probably goes for EQ2 and EQ, given the limitations imposed on non-subscribers, though I am not aware of any official dev statements on the topic.

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11. Wilhelm Arcturus - July 18, 2014

@Vatec – At one point Smed said something similar about f2p driving people to subscribe, when the move was being made with EverQuest II. He has since changed his tune some, and was last heard heralding the death of subscriptions at SOE… seeming to forget that they still have a subscription.

As for Rift, I was wondering about them as well, but then remembered that the last time I tried to patch I couldn’t do it unless I installed their new digital distribution platform, Glyph. That pretty much assured that I will never return to the game. Even EA knows it can’t force Origin on people who want to play SWTOR.

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12. Matt - July 18, 2014

I’d say the death of subscriptions is about where we’re at, assuming that data is right. F2P hasn’t turned MMOs into the next big thing or created the next WoW, but then F2P revenues are holding steady while subscription revenues are nosediving. Maybe subscriptions can only work when options are limited, as they were 10 years ago. Once you have 4 or 5 games of interest subscribing to them all starts to look pretty silly.

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13. Grumpy Koala - July 19, 2014

LOL Why are we even discussing this piece of click bait?

Last time they came up with one of these it was deeply flawed and designed to get people to pay for the ‘report’ which when analyzed showed how bad they were at research (I know because last time I paid). This time we have another doubtful and incomplete piece of nonsense and again we would have to pay to see how they came up with it.

But just to provide an example look at that second graph again, Those last two data points are labelled 2014E and 2015E. E for estimated, we are only half way through 2014 at the moment so that would have to be based on first quarter figures at best, but I am guessing it is a wild assed guess just like the 2015E number.

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14. Wilhelm Arcturus - July 19, 2014

@Grumpy Koala – Grumpy indeed. Must be because you paid. Even I am not THAT interested in the numbers.

Anyway, even bad or incomplete data can raise questions worth discussing. And the main revenue chart is based on 2013 figures and, hey presto, it seems to have some correlation with another bit of dubious data, the Xfire MMO charts I linked to. Seemed worth a post to me. Plus there is always a bit of QFT in these posts, because I always come back to them when more data becomes available.

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15. Vatec - July 19, 2014

@Wilhelm Arcturus – Yeah, Smed and Scott Hartsman have both apparently recognized the inevitability of F2P models. Ironic, given that both were outspoken critics until a couple of years ago.

As for Glyph, digital distribution platform seems to be a new industry trend. Perfect World has ARC, Trion has Glyph, even Blizzard has Battle.net…. Not a trend I like at all. Of course, all it really does is push me to register these games (when available) on Steam. If I =must= use a digital distribution platform, it might as well be the one into which I’ve already invested hundreds of dollars, right?

@Grumpy Koala – With the exception of public companies, these numbers are always guesses. And even public companies’ info isn’t all that transparent when they’re wholly-owned subsidiaries of other companies. It’s very easy to bury the relevant data deep down in the parent companies’ financial reports. I bet Turbine’s entire budget is barely a rounding error on Warner Brothers’ books, for example.

The only numbers on there that I’d have any confidence in at all are WoW and SWTOR.

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16. Syl (@Gypsy_Syl) - July 19, 2014

I am baffled at the lack of seeing FFXI or FFXIV on there….

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17. Wilhelm Arcturus - July 19, 2014

@Vatec – I would trust NCsoft and CCP numbers, as they are both public companies that issue fairly specific financial reports. I could glean that information about NCsoft games pretty easily and I think I already reported the CCP number earlier this year. Let me just drag that out.

Hrmm, the CCP number for direct EVE Online revenue was $74 million. 93 million doesn’t enter into it as far as I can tell, as DUST 514 only put another $2 million on top of that.

LOTRO though… given the CCP number oddity… seems like it could be “everything we do at Turbine, plus some blue sky modifiers.’

Hey, I bought Rift through Steam as well. I suppose I could use that as a bypass.

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18. Vatec - July 19, 2014

@Wilhelm Arcturus – Yeah, I guess those two as well. Didn’t realize CCP was public, thought it was private or closely-held.

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19. NetherLands - July 20, 2014

I think that you are correct that SOE didn’t give any numbers and/or fell into some kind of ‘definition trap’ as you’d think at least one title would make the 1% mark.

NCsoft seems to be the big thing after Blizzard, with 16% (didn’t see WildStar, though, which may be of concern to those who believe you can make a triple-A game aimed at a very specific niche if this remains the case) and ‘failed’ LotRO and esp. SWoTR outperforming EVE (queue ‘untergang bunker scene’ in certain quarters of the bloggosphere ;P)

Wonder what essentially cutting dead-weight content from LotRO will do for it (speaking of which, found the time for my third comment on the Raid subject).

It’s nice to see the X-fire numbers from Nosy seem to be backed up, the MMOverse could use more (and more solid) data than what the general public usually gets.

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20. Green Armadillo - July 21, 2014

While I’m not the most sanguine on Turbine, I think you’re reading too much into their release schedule, which has been horrible since the game’s second year. Going from a raid every other year that isn’t even ready for the expansion launch to zero raids isn’t really a change, just an acknowledgement of the inevitable. Likewise, it seems like they’re releasing content that would otherwise have gone in an expansion, including new zones and a new class, as free-to-subscribers DLC instead.

The dirty secret of subscription-optional “free-to-play” is that the model is actually about charging pre-conversion subscribers more. The whales buying $50 hobby horses etc aren’t doing that instead of the subscription, they’re doing this on TOP of the subscription. This is why I think we can believe Turbine when they say that they chose not to do an expansion due to complaints from subscribers.

LOTRO and DDO subscribers were correctly pointing out that with annual expansion box fees that aren’t covered by the subscription, there was very little point to continuing to subscribe – you get an exp bonus that’s good once a year when the cap goes up and not much else that you can’t get cheaper a la carte. However, when that player “upgrades” from VIP to premium due to expansion box fees, Turbine doesn’t just lose the $10-15 per month – that player is more likely to give up on the game (which is now a less fun experience due to all the upgrade nagging) and thus the microtransactions as well.

See also SWTOR, with “expansions” that only cost extra for non-subscribers – they’re leaving that money on the table because it’s worth less in the longrun than pushing players to subscribe.

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21. SynCaine - July 21, 2014

Google failed me (it was a weak effort), but didn’t we conclude that this company is 95% troll the last time they released numbers?

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22. Wilhelm Arcturus - July 21, 2014

@NetherLands – WildStar isn’t on the first chart because that is for 2013 revenues.

@GA – Well, the complaints about expansions didn’t get really shrill until Turbine decided they needed to jump up the price points while cutting back on the extras the last time around. Since subscribers are also most likely to purchase, that really started to feel like they were trying to over-harvest their best customers.

@SynCaine – Are you suggesting that a site like Massively would run something like that? Didn’t you read that editorial where they said that they do not run click bait stories… unless they think they can get away with it?

Anyway, as I said above, this is as much QFT as anything. Friday fodder.

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23. Where Are All the Bodies?, pt 2 | In An Age - July 22, 2014

[…] “Where are all the bodies?” in terms of a trend of flight from MMOs. Last week, Wilhelm presented the SuperData Research group’s June report. The two slides of note are […]

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24. Only Paying Bodies Count | Random Waypoint - July 25, 2014

[…] be able to understand much unless you go and read Azuriel’s post, which is a followup on Wilhelm’s post, which in turn looked at a report by SuperData Research. Go and read the two blog posts […]

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